2.1.8 Preliminary discussion on "Syllogism" (2)

One of the common problems that traders may encounter in common: when reading research reports, news, and information, traders think that "Major premise" is correct, and therefore accept the conclusion and take action based on the conclusion. This may involve trading risks but not aware of them.

The following is the analysis information given on the virtual "Lido Machinery Company". We use this as an example to make a general discussion of people's thinking habits.

Recently, the stock of Lido Machinery Co., Ltd. (the virtual company of this article) continued to rise, and the driving force for the rise in stock prices came from the good fundamentals of the three quarterly reports.

When a trader sees similar text, the trader can easily translate the sentence into a "good fundamentals" stock that will cause the stock price to "continue to rise." Now we turn this sentence into a more explicit A proposition expression below, and use the syllogism to simulate possible thinking processes.

The trader will unconsciously perform some conversions in the above sentence.

Lido Machinery's good fundamentals of three quarterly  are the driving force for the  rise in Lido Machinery's stock prices.

Then this sentence will be transformed into another unconscious conversion (without the word "Lido Machinery"):

Good fundamentals of three quarterly  are the driving force for the  rise in stock prices.  (Major premise)

Next, expand the inference below.

The fundamentals of three quarterly of Fuyun Ore (this company's virtual company) are good. (Minor premise)


The fundamentals of three quarterly of Fuyun Ore are good for the rise in Fuyun Ore stock prices. (Conclusion)

According to this conclusion, traders may buy shares in Fuyun Ore Company.

In fact, at this time, the trader should review the article's discussion of the A proposition. At this time, it is clear that the "The fundamentals of three quarterly are good " is only one of the full powers of the stock price increase.

With this understanding, when traders face the trade of Fuyun Ore stocks, they will not only decide their own behavior from the condition that the fundamentals are good in the third quarter.

However, even with such an obvious way of thinking, many traders will give up. The reason is that the next step in finding other reasons for stocks to rise will cause traders to fall into the search for “uncertain” information. Most traders prefer to accept isolated "certain" information.

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